Wednesday, September 28, 2022
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HomeFinTechKenya's Banks Ordered To Stop Dealing With Flutterwave And Cipper Cash!

Kenya’s Banks Ordered To Stop Dealing With Flutterwave And Cipper Cash!

According to media reports, the Central Bank of Kenya (CBK) has ordered lenders and microfinance institutions to stop doing business with fintech companies Flutterwave and Chipper Cash. The CBK said in a letter to the CEOs of commercial banks, microfinance companies and mortgage lenders that the two startups have been making money transfers without the required approval from the banking regulator.

Flutterwave, which is also facing money laundering allegations in Kenya, in a statement said it has been operating in the country through partnerships with regulated banks and telecoms, as it waits for a payments service provider license it applied for in 2019.

“It has come to the attention of the CBK that Flutterwave Payments Technology Ltd. and Chipper Technologies Ltd. are engaged in the money transfer business without a license and approval from the CBK,” the letter reads, quoted by Kenya’s Business Day newspaper.

The move comes days after CBK Governor Patrick Njoroge told the media at the Monetary Policy Committee meeting that the two fintech firms were not licensed to provide money transfer and payment services in the country.

Money remittance services in Kenya are regulated by the Central Bank of Kenya Act and the Money Remittance Regulations, 2013. The letter said that the National Payment System Act regulates money remittance services and the National Payment System Regulations, 2014.

Flutterwave reiterated its commitment to operate within Kenyan laws, regulations, and industry standards.

“We understand and respect the responsibility of the Central Bank of Kenya to protect the payments ecosystem. We support ongoing collaboration between regulators and fintechs to create an atmosphere that fosters innovation in the financial services industry,” the statement said.

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